Sunday, March 11, 2012

The Better Business Bureau, one of the country's best known consumer watchdog groups, is being accused by business owners of running a "pay for play" scheme in which A plus ratings are awarded to those who pay membership fees, and F ratings used to punish those who don't.

To prove the point, a group of Los Angeles business owners paid $425 to the Better Business Bureau and were able to obtain an A minus grade for a non-existent company called Hamas, named after the Middle Eastern terror group.

"Right now, this rating system is really unworthy of consumer trust or confidence," said Connecticut attorney general Richard Blumenthal in an interview to be broadcast as part of an ABC News investigation airing tonight on 20/20.

In an official demand letter sent to the national headquarters of the Better Business Bureau Thursday, Blumenthal called on the BBB to stop using its grading system, which he said was "potentially harmful and misleading" to consumers.

Click Here To Read the WARNING letter to the Better Business Bureau from the Office of Attorney General.

"The BBB accreditation and the BBB ratings systems is not about generating money," said BBB national president and CEO Steve Cox. He said the A minus grade for Hamas was given in error. "Plain and simple, we made a mistake," Cox told ABC News.

Errors seem to abound at the Better Business Bureau. As reported by an anonymous blogger the BBB also awarded an A minus rating to a non-existent sushi restaurant in Santa Ana, California and an A plus to a skinhead, neo-Nazi web site called Stormfront.

Each listing cost $425.

"They ran the credit card and within 12 hours they were an approved, accredited member," said the anonymous blogger, who runs a site called bbbroundup.com.

"They're more interested in the money than their credibility," he said.

The BBB's Cox said the three listings were all mistakes made by sales people.

"That's an inaccurate statement that business people are able to buy A's," Cox said. "We have more than 500,000 non-accredited businesses who have A ratings," he added.

Better Business Bureau: Pay for Play?
Yet, as part of the ABC News investigation, an ABC News producer with a camera was present as two small business owners in Los Angeles were told by Better Business Bureau tele-marketers that their grades of C could be raised to A plus if they paid $395 membership fees.

Terri Hartman, the manager of a Los Angeles antique fixtures store, Liz's Antique Hardware, was told only a payment could change her grade, based on one old complaint that had already been resolved.

"So, if I don't pay, even though the complaint has been resolved, I still have a C rating?"

Hartman then read off her credit card number and the next business day the C grade was replaced with an A plus, and the one complaint was wiped off the record.

In a second case, Carmen Tellez, the owner of a company that provides clowns for parties was also told she had to pay to fix her C- grade, based on a two-year old complaint that she says had already been resolved.

The C minus became an A plus the very next day after she provided her credit card number for the $395 charge.

"If I'm paying for a grade, then how are the customers supposed to really trust the Better Business Bureau?" she asked.

Cox said the examples provided by ABC News were violations of sales policy and not a standard way of doing business.

"The BBB is not operating fraudulently," Cox said.

In his demand letter to the BBB, the Connecticut Attorney General said, "I am deeply concerned that certain BBB practices threaten its reputation and effectiveness as a reliable resource for consumers."

Allison Southwick, media relations manager for the BBB, said that the BBB had worked with Attorneys General across the country, including Blumenthal, to fight fraud. "We disagree with his characterization that BBB does not adequately disclose the fact that Accredited Businesses financially support BBB," said Southwick. "However, we are always interested in hearing from our partners in consumer advocacy and are pleased to accept constructive feedback from his office and other consumer advocates."

"We have made good progress in working with his office on these issues, and anticipate that we will satisfactorily address his concerns," said Southwick.

Better Business Bureau Grading System
The Better Business Bureau, a non-profit group that began 98 years ago, instituted its A plus through F grading system just two years ago, replacing a "satisfactory/unsatisfactory" ratings system.

One of the first to raise concerns about the new grading system was New York Congressman Anthony Weiner. Weiner was investigating complaints to his office about the popular precious metals dealer Goldine. Some customers had alleged they were ripped off after responding to Goldline's television ads, which appear in heavy circulation during conservative talk radio and television programs.

Goldline responded to Weiner's criticism in part by pointing to the stamp of approval the company had received from one of the nation's most respected consumer groups.

"We are proud to be rated A+ from the Better Business Bureau," Goldline VP Scott Carter said at a congressional hearing convened by Weiner in September.

Weiner told ABC News he considered Goldline's A plus grade to be suspect.

Weiner and other critics say they believe the BBB has used the new grading system as part of an extensive tele-marketing campaign to increase membership and revenue.

An ABC NEWS examination of filings with the federal government revealed that at least 25 of the Better Business Bureau's top officers had salaries in excess of $100,000.

The head of the Los Angeles Better Business Bureau, William Mitchell, was paid more than $400,000, according to the Better business Bureau.

"I think the Better Business Bureau changed course and lost its way by adopting a system of pay to play that maybe enhanced its revenues but also greatly diminished its credibility and honesty," said attorney general Blumenthal, who was elected to the United States Senate from Connecticut last week.

"It's very troubling and it could be illegal because the failure to disclose to consumers could well be deceptive and misleading," he added.

The ABC News investigation found numerous examples of well-known companies that are not members of the Better Business Bureau being branded with F grades, often apparently based on scant evidence or a small number of complaints.

The five-star Ritz Carlton Hotel in Boston was given a F rating after only two complaints.

"A million customers served, two complaints resulting in an F rating, seems to be somewhat unusual, to say the least, " hotel general manager Erwin Schinnerl told WCVB-TV in Boston.

Celebrity chef Wolfgang Puck told ABC News that parts of his food and restaurant empire have received an F grade because he refused to pay to join the Better Business Bureau.

"You know, if you become a member, you're sure to get an A, but if you don't pay, it's very difficult to get an A," said Puck, who has been a regular on the ABC News program "Good Morning America" since 1986.

"I think where you have to join an organization to get a good grade is wrong," Puck said.

Monday, October 24, 2011

In addition to is previous practices the BBB (Better Business Bureau) gave a terrosit organization an A Rating! This is another horrible embarrassment for the BBB (previous story) who will give anyone a good rating who pays their fees.

In an embarrassing move that shines light on how little checking is done by some Better Business Bureau’s before accrediting a business, a California blogger revealed tonight that someone has managed to get a fake business with the name of the terrorist organization Hamas accredited by the bureau in return for a fee.

BBB Reliability Report for

Hamas

A BBB Accredited business since 07/12/2010

Rating Explanation

Company Rating A-

Our opinion of what this rating means:

An excellent rating. A company with this rating may not rate higher because of a greater number of rate-lowering factors, but we do not consider them to be factors that would likely adversely affect consumer transactions.

The blogger, a businessman who uses the name of “Jimmy Rivers” to keep his identity secret from the Better Business Bureau for fear of harassment or retaliation, published the following three columns tonight, including the one about Hamas:

To my surprise, the Hamas “business” which claims to provide “educational programs for troubled youth” from a nonexistent address, is still on the bbb.org website as of this morning. I guess the $425 buys you real credibility with the BBB.

Hamas was taken down later today, but I doubt the BBB will refund the $425.

Rivers has been on the forefront of investigating the Better Business Bureau’s letter grading system. When I was at the Courant we worked together on some investigative columns.

Tonight’s blockbusters take his investigation to an even higher level.

Rivers is a former journalist, now businessman, who started his blog www.bbbroundup.com as questions were raised by consumer columnists and advocates, including myself about the letter grade system that replaced the simple pass/fail system.

“So, where were these standards when the BBB accredited and welcomed the terrorist group HAMAS as a member?,” Rivers asks in his column.

“Now in case one might think this an isolated instance, be assured it’s not. A group of angry and frustrated businesses across the United States and Canada have decided to fight back. The registering of these BOGUS BUSINESSES has been ongoing for quite some time. The HAMAS registered with the BBB does not actually exist, except as a member of the Better Business Bureau. Here’s another Bogus Business that was awarded BBB accreditation from back in June of this year. Whatever happened to the review and acceptance that’s supposed to be done by the local Board of Directors of the BBB?”

“When I first started my investigation I found pretty early on that they were a corrupt and flawed organization. Never in my wildest dreams did I comprehend how fully invested the Better Business Bureau was in greed, hypocrisy and arrogance. The fact that anyone can call up the BBB and wave a credit card in front of them and get an “A” grade is just plain evil. It certainly exposes their grading system as being totally useless.”

“Unfortunately, it is the consumer and the small business who suffer from the BBB’s greed. My take is that the BBB should be shut down. Barring that, they need to immediately pull all grades from their websites and put right all that they have done wrong,” Rivers said.

It will be interesting to see what the Better Business Bureau has to say for itself Tuesday.

Saturday, October 16, 2010

Larry Routh, director of UNL's Career Services, said the seriousness of a mark on an applicant's criminal history is dependent on both the nature of the job and the nature of the offense. "It really is highly individualized," he said.

For example, procuring alcohol for a minor is considered a Class 1 misdemeanor (the most serious and carries the harshest penalties among misdemeanors). And that is not something you want to carry with you, said Shelley Stall, director of Student Legal Services at UNL.

"It looks really bad on your record, particularly if you're in Teacher's College or you're interested in coaching, working with kids on any level," she said. "Graduate school programs really don't want to see that on your record and neither do employers. So it's a thing to avoid." And being in the Teacher's College himself, Gambrel recognizes the challenges he may face as he begins applying for student teaching positions.

Tuesday, August 17, 2010

As Records Removal Services pointed out today, expungement is a process, not an event. Even after your expungement is granted, it is useless until government and privately owned criminal databases are updated. In most cases, criminal databases have 180 days to remove your name from their database if a pardon, expungement, seal, or non-disclosure is granted. (see related blog post)

clearmyrecord.com hired Montel Williams as a paid endorser. The company that owns clearmyrecord.com, FiTech, Inc. is no longer an active corporation in Kentucky.

The largest privately owned criminal background check company is still in good standing in the Commonwealth of Virginia, but that is no surprise since they have so many government contracts.

Tuesday, July 27, 2010

About the Better Business Bureau
Though the Better Business Bureau sounds good in concept, the companies pay to be members. Nothing is charged to you, the consumer. Companies who generally do not pay to be members have bad ratings, while companies who do pay to be members have good ratings. (source)

Consider the following:Question:If you operate a local Better Business Bureau franchise, and a large corporation is paying you $5,000.00 in dues, would you risk upsetting that company by giving them a bad rating? If you give them a bad rating and they stop being members, who is going to pay the salaries of the people working in your local office?

Companies pay between a few hundred dollars and $10,000 to be a BBB-accredited member, and as the bureau grows, so does its reliance on those funds. Across its 112 regional offices, dues and advertising fees make up, on average, 90 percent of revenue. Some see a conflict of interest, but council CEO Steven Cole says the BBB wants members — not consumers — to pay for its programs. (source - Smart Money)Criticisms of the BBB
The BBB does not recommend specific businesses to consumers, but simply supplies information.Regarding how a group funded by businesses can be fair to consumers, the bureau's website states that its value to businesses depends on its neutrality. (source - Smart Money)

BBBs have been accused of unduly protecting companies. The BBB responds by, at a minimum, notating complaints on the "Reliability Report" section of its web sites. (source)

Criticism on Biased Rating System
On June 1, 2009, BBB offices nationwide adopted an A-F ratings system. This grading system has been criticized for being biased in favor of companies that pay dues to BBB. (source)

The BBB of Central Illinois states on their website that only businesses which pay dues are eligible for an A+ rating. This seems to call into question the supposed neutrality of the BBB.

Criticism on Case Resolutions
It has been reported that the BBB encourages and solicits money from the very businesses they have been monitoring. This has not been beneficial to the customer as expected it to be.

BBB's soliciting of funds from business further questions it's neutrality. Numerous cases can be found in which major corporations have thousands of complaints filed against them while maintaining an A+ rating with the agency. Small business owners can receive as little as 10-20 complaints and watch their rating downgraded. Several small business owners have voiced their concerns over this practice particularly smaller businesses that must compete with multi-billion dollar powerhouses.

Membership Privileges: Use of Accreditation term
Instead of pronouncing a firm "satisfactory" or "unsatisfactory" in its reliability reports, the bureau is now issuing a new label, "accredited," that any business can obtain by becoming a BBB member.

Council CEO Steven Cole says the business will still have to meet certain standards, but a number of chapter presidents expressed concern that disturbed companies could use the label to hide problems. (source - Smart Money)